Fibre rolloutsFibre rollouts

Briefing on the work currently underwayBriefing on the work currently underway

5 March 20095 March 2009

2

Status of fibre rolloutsStatus of fibre rollouts

• The leading broadband market players have announced fibre rollout plans

– Projects equalling an investment of close to 2 billion euros announced to date

– Rollouts concentrated for now in zones where operators were able to access civil infrastructure:

▪ Chiefly in Paris for Free and SFR, thanks to access to visitable sewers

▪ Numéricâble engaged in upgrading its network

▪ France Telecom present in some 10 metropolitan areas

0

1 000 000

2 000 000

3 000 000

4 000 000

0 100 000 200 000 300 000 400 000 500 000

• Operators’ interest in ultra fast broadband is due in part to the success of broadband in France

– over 98% of the population covered for broadband and a 55% penetration rate

– over 75% of the population covered by unbundling and around 50% with access to a triple play bundle over ADSL

– good results to which local authorities are contributing via public initiative networks

Germany

Denmark

France

Netherlands

Norway

Italy

Sweden

Homes passed

subscribers

Ultra fast broadband rollouts in Europe(end of 2008, source: IDATE and ARCEP estimates for France)

(estimate)

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The applicable regulatory frameworkThe applicable regulatory framework

Access to civil infrastructure:

Following the market analysis decision of 25 July 2008:

- France Telecom is required to provide access to its civil infrastructure under transparent and non-discriminatory conditions, and at cost-oriented prices

- no obligation concerning fibre as yet

Last part of optical fibre networks:

The Law on modernising the economy, LME (La loi de modernisation de l’économie ) defines a framework that encourages fibre rollouts, through measures that:

- make it easier for operators to install fibre on private property

-limit the risks of local monopolies in buildings, thanks to a principle of sharing the last drop which ARCEP is responsible for implementing

- pre-equipping greenfield projects with optical fibre

• The regulatory framework is composed of two complementary tools:

• The goal is to enable all operators to invest in ultra fast broadband

• The European Commission is to adopt a recommendation on new generation access (NGA) regulation. The draft version of the text is in sync with the approach being taken in France, which is currently the most advanced in Europe

Concerns France Telecom specifically concerns all operators

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• France Telecom published a reference offer:

– on 15 September 2008

– This offer is the result of a process of discussions and trials between operators that helped test the principles involved

• The economic component of the offer requires work:

– Setting the price for renting ducts

– Level of reinvestment in civil engineering

Regulation concerning France Telecom civil Regulation concerning France Telecom civil infrastructureinfrastructure

example of shared occupancy of a France Telecom duct

France Telecom copper cables

ducts Operators’ optical fibre

• The offer will be improved gradually:

– The processes will be adapted to enable large-scale rollouts

– Engineering rules will need to be technologically neutral and encourage efficient occupancy over the long term

– ARCEP teams monitoring in the field to ensure operators have non-discriminatory access to civil infrastructure

• Alternative operators are currently performing field studies to assess the availability of France Telecom civil infrastructure. Based on the results, they will be able to engineer their network and perform the first deployments using this infrastructure.

5

Work underway on mutualisationWork underway on mutualisation

• Operators are currently involved in trials and assessments under the aegis of ARCEP, within the ultra fast broadband Steering committee which launched in late 2008

• Trials have begun at some 20 sites, involving close to 2,000 households

• Architectures are being assessed by a steering committee, based on work being performed and feedback from three technical sub-committees whose task is to:

– describe the different architectures tested and their operational mechanisms

– assess installation and operating costs

– establish technical specifications to ensure network interoperability

• A briefing will be conducted in late March under the aegis of the Secretary of State responsible for Economic Prospective and Development

• Based on results and feedback, the Authority will gradually define the applicable rules of mutualisation

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Indoor fibre deploymentsIndoor fibre deployments

• Related work is being performed with real estate professionals and consumers:

– A chat on fibre was held and FAQs are available on the ARCEP website

– A set of guidelines for real estate professionals is in production

• ARCEP has published a sample agreement whose purpose is to reconcile the demands expressed by property owner/manager representatives and by operators:

– define essential guarantees concerning the role of building operator

– limit red tape

• Pursuant to the Law on modernising the economy, Decree no. 2009-59 specifies sample clauses with which agreements must comply

– ARCEP will publish an updated sample agreement

– ARCEP will adopt a decision that allows operators to exchange information on fibre-equipped buildings (Article R.9-2 of the CPCE)

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Local authority involvementLocal authority involvement

As an extension of existing public initiative networks,

local authorities will continue to equip their city/region with optical fibre networks:

– to enable higher speeds on fixed and mobile networks in the medium term

– to prepare for the deployment of fibre to the home at a later date

InventorySource: Manche Numérique

• Local authorities can facilitate operators’ fibre rollouts by:

– performing field studies that inventory installation modes and potentially available infrastructure

– making civil engineering ducts or overhead installations available for laying cable, and technical locales for housing concentration points (OLT, etc.)

– installing extra ducts when performing road work

– authorising the installation of outdoor cabling, use of lightened civil engineering, installation of street cabinets, etc.

Installation method

IndoorOverhead

UndergroundOutdoor

Mixed (O + O)